This Digital Property Seeker Series focuses on the supply and demand in the residential market during the fourth quarter of 2018, covering the following residential categories in the Philippines:

Lot

House

Apartment

Condo

This study will dive deep into these categories, identifying the top locations that experienced the most supply or demand increase, along with the reasons behind them based on data gathered independently by Lamudi and ColIiers Philippines covering the given period.

The Demand
section was based on three indicators: Leads, Sessions, and Pageviews.

Page views are the total number of page visits. However, they are not unique
views but an aggregate of all visits. Sessions
are the number of times spent by a user in searching for a property. There
can be multiple page views within each session. A Lead, on the other hand, refers to a property seeker that has made
a query, which, may later on be converted into a sale.

October registered as the best performing
month across all categories measured by the three indicators. Overall numbers
in all categories, however, declined in December.

The Apartment
category had the highest percentage of pageviews, sessions and leads for
the fourth quarter. In last place was the House
category. It is a shift worth
noting as the house category generated the most interest in all three
indicators in the prior quarter.

The study’s Supply section, on the other hand, will give a brief overview of
the residential real estate trends for the fourth quarter of 2018. It will also discuss the general
outlook of the residential sector for the entire year and a few points on the condominiums market in
particular.

Data on the estimated number of condominium
units currently available in the country will also be provided. This could give
an insight on how difficult it is to meet the housing shortage despite the
earnest efforts of private developers and the government, as well as show the
current concentration of condominium projects in Metro Manila.

Supply
Overview

According to Lamudi’s exclusive data, from October to December 2018, the country saw the overall supply of
its residential real estate properties take a slight dip to 7.45 percent. It
was on a steady rise all throughout the year, beginning from a low of 1.72
percent in the first quarter. This jumped to 9.80 percent from April to June
before peaking at 10.92 percent from July to September.

Despite its upward
trajectory being cut short on the fourth quarter, 2018 still managed to provide
a respectable number of options for interested buyers. While these
availabilities can be easily snapped up in the next quarter, it remains to be
seen how quick developers can react.

Demand continues to surge, and it is no longer confined within the usual locations in metropolitan areas. Fringe areas are also getting significant amount of attention and it is only a matter of time before more developments start sprouting from there.

Available residential
properties are also being featured more prominently in the provinces. This is a
great opportunity for investors to buy in while prices are still low as
compared to other parts of the country. Furthermore, there is a higher
appreciation rate that the properties will enjoy as more developments take
place.

Residential
condominiums remain to be one of the most accessible types of properties for
interested investors to get into. Not only will they profit as the value of
their investment grows higher, but they could also earn lease income in the
process as well.

According to
Colliers Philippines, 5,100 new residential condominium units were completed
during the fourth quarter of 2018. As a result, the total inventory for 2018
reached 11,800 units, helping satisfy the growing demand for such properties.
It came in about 26 percent less than 2017’s total however, which was at about
15,900 units. Metro Manila now has an estimated 118,900 condominium units in
its supply.

Developments coming from the Bay Area and Fort
Bonifacio district represented the bulk of the fourth quarter inventory. This
was mainly buoyed by requirements coming from the Philippine Offshore Gaming
Operators (POGOs) and other foreign investors. In the same report by Colliers,
such areas took up to 75 percent of supply for Metro Manila, while the rest
came from different parts of the country.

Demand Overview

The Lamudi platform
yielded encouraging figures for residential property listings. Leads during the
fourth quarter surpassed that of the third quarter for all four categories. It
was, however, different when it came to sessions and page views. The Apartment category was the only one
ahead for sessions while House was
the only one behind for page views.

There were more
users visiting the site in the last quarter of 2018 but less were performing
searches as compared to the third quarter. In spite of this, it still generated
more inquiries, providing listing owners with more chances to unload their
properties to interested buyers.

The Apartment category garnered the highest numbers across all three indicators. This appears to signify a move towards downsizing or quite possibly influenced by the growing POGO industry. There has been an increase in requirements for staff houses in the past months, mainly from POGO employers looking to house their employees in affordable accommodations.

Not all residential developments, however, allow such arrangements. Subdivisions, for example only allow one family per dwelling. Condominium associations on the other hand, set limits on how many persons may occupy a unit. Staff house requirements try to fill as much people in one lodging to reduce costs. Apartment owners could be more tolerant since such occupant types for these residential properties are more common.

In spite of this,
condominiums are still very popular across various segments in the market.

Colliers Philippines
reported that there was healthy demand for residential condominiums around
Metro Manila, which can be seen especially for properties near central business
districts. There is also a steady requirement for ready for occupancy units
coming from local and foreign buyers wanting to be located near their
workplace.

Pre-selling projects,
however, are not to be left behind. Colliers disclosed that there was up to
4,800 pre selling residential condominium units sold in the fourth quarter of
2018. This number bolstered the year’s tally to 54,000 units, beating 2017’s
total by 1,000 units. Developers were advised by Colliers to look into areas surrounding
business hubs where they may potentially set up new projects. Much emphasis was
given to Quezon City, particularly those locations near the stations of the
planned Mega Manila Subway.

Meanwhile, based on
Lamudi’s exclusive data, when it came to the monthly overall figures, October
led November and December across all three indicators. The same was true for
the four categories as well.

This might be possibly
attributed to the holiday rush as more people allocated their time preparing
for the Christmas season as the year drew to a close. The month of December
scored the least pageviews, sessions and leads for the fourth quarter monthly
figures. It also consistently generated the smallest share of interest in all
the four categories.

Top 20 cities/municipalities with most page visits, searches, and leads for Residential Lot

Iloilo, Lucena, Cainta,
Subic, and Panobo were the top five locations for leads during the months of
October to November. This order, however, was replaced during the months of
November to December. Maragondon took the lead this time, followed by Legaspi, Tacloban,
Tabaco, and Marilao. Overall, leads for lots had Tacloban up front with Iloilo,
Subic, Legazpi and Trece Martires in succession.

None of the top five
locations that garnered the highest overall leads had a month where they led in
sessions. For example, third place Subic might have had a 61 percent session
rate in November but was topped by the 70 percent of Panobo. While, Subic only
registered a mere 6 percent in October. The 33 percent in sessions it had in
December was not even part of the top 5 for that month.

It was the same when it
came to page views. The top five converting locations did not lead in any month
for this indicator, with the exception of Legazpi having 97 percent in
December. The low percentage of sessions and page views revealed that the top
five in leads are high converting locations.

Top 20 cities/municipalities with most page visits, searches and leads for Residential Houses

The top five for this category were Jagna, Mexico, Iloilo, Bay, and Bongabon, respectively. Despite having zero percent leads between October to November, Jagna still managed to jump to a first-place finish. This is attributable to a 153 percent thrust in leads for its November to December tally. Mexico exhibited a steadier increase that allowed it to come in second at 118 percent. Iloilo, Bay, and Bongabon all had a 100 percent boost to their leads total.

Note that Iloilo once
again appeared in the top five, signifying that a great number of property
seekers want to know more about residential lots or house and lots in this
city. Poised as one of the newest emerging cities due to its impressive
economic activity, it is no surprise that this beautiful province in the
Western Visayan region is getting so much attention.

The top placements of
Jagna and Mexico were unaffected by the gradual dip in sessions throughout the
three months of the fourth quarter. Perhaps the slightly increasing page views
helped with the conversions. Regardless, both locations finished strongly at
the close of the year.

Top 20 cities/municipalities with
most page visits, searches and leads for Apartment

It is worth mentioning
that the top eleven locations in this category received over 100 percent in
leads. Even twelfth placed Bacoor came quite close at 94 percent. What is more
noteworthy, however, is that the top five all received over 200 percent leads.
This underscores the interest of property seekers in apartments.

Top placer Tarlac came
in with 897 percent in leads. It could be attributed to the planned development
of New Clark City in Capas, Tarlac. Those helping to develop its 9,450 hectare
expanse would certainly need housing for the duration of the project.

Olongapo and
Minglanilla both came in with 600 percent leads. It is a statistical tie that
is likely to represent future developments in these locations.

Fourth placer Abucay
and fifth placer Valencia garnered a respectable 500 percent and 233 percent.
These figures could indicate that these are areas to watch out for in the
future.

There was a general
increase in page views for this category from October to December. The same was
also observed when it came to sessions.

Top 20 cities/municipalities with most page visits, searches, and leads for Residential Condominium

There was significant
interest for the first two locations as compared to the rest of the list. The
number one lead generator Dauis, registered a 233 percent increase. Second
placer General Trias, on the other hand, was close behind at 225 percent. A distant
third was Bacolod at 75 percent while Taytay and Talisay were a few points away
at 68 percent and 67 percent each.

It is this category,
however, which received the least increase in leads.

This could possibly be
attributed to the average amount of sessions generated throughout the three
months under observation. There were hardly any locations that breached 50
percent in any one month.

Both October and December registered two cities that went
beyond a 50-percent increase in session while November had only one. The rest
of the cities in the the three-month period were all below 50 percent. This might be caused by the easy marketability of condominium projects,
resulting in increased exposure from other sources. There are many brokers who
carry such properties in their inventory which could be the reason for such
results.

Condominiums are
certainly one of the most in demand properties in the residential real estate
category.

OUTRO

Despite a slight dip in residential property seeker
activity during the last quarter of 2018 that is attributable to preparations
for the holidays, there is
no doubt that there exists a steady forward movement in terms of demand.

A growing middle class, aggressive infrastructure
initiatives from the national government, and a newfound interest from foreign
investors and workers are all drumming up the demand.

To curb the demand, property developers must seize the
opportunity this 2019. For one, developers must renew their interest in the
Quezon City and Ortigas areas in lieu of the multi-billion Mega Metro Subway as
the first few stations will be constructed in the said districts. Fringe areas
and emerging cities are also attractive new prospects to explore.

Upscale residential projects in the Bay Area remain to
be a good prospect to cater to affluent families residing in Southern Luzon, as
well as to the offshore gaming operators. There also lies an unparalleled
proximity to the Manila International Airport and ease of access to primary
business hubs and retail establishments in Metro Manila.